Conservative budget for agriculture, as Coalition looks ahead to the election

Conservative budget for agriculture, as Coalition looks ahead to the election

The 2016 federal budget has struck a conservative note this year with inland rail and wine tax the big ticket items, leaving hot issues like mobile black spots and further changes to the backpacker tax off the agenda for now.

And as the Treasurer Scott Morrison hinted in a budget press conference, it’s likely any substantial announcements will be held for the election campaign.

The wine equalisation tax rebate will be cut back over two years, from $500,000 to $290,000. The government will also tighten eligibility for the rebate, and introduce “additional integrity measures” designed to stop people claiming the rebate multiple times each year.

The government will also extend the excise refund scheme for distillers and producers of “low strength fermented beverages such as non-traditional cider”, from July next year.

While the budget contains $594 million for an inland freight rail network from Melbourne to Brisbane, farmers will be disappointed that there’s still no sign of a start date for the long-awaited project, which is expected to cost around $10 billion to complete.

In the lead up to the budget, the National Farmers’ Federation declined to put a figure on the amount it wanted to see in the government’s figures on Tuesday night.

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Instead, NFF chief executive Tony Mahar said all that mattered was a budget that would see “rail laid and turf turned”.

Meanwhile, there is no relief for farmers hoping the budget would deliver a resolution and certainty on the government’s backpacker tax plans.

The government has made no move to reverse its controversial plan to scrap the tax free threshold for backpackers and tax them at 32.5 per cent from the first dollar earned, from July 1.

However, Mr Morrison hinted at a forthcoming announcement during the election campaign.

It follows comments on Tuesday by Nationals MP Andrew Broad who was “fairly confident there will be an outcome that will be to the satisfaction of horticulture producers”.

Concessional loans to build ‘banks’ for water

The government has announced a $2 billion concessional loans facility to help state and territory governments build dams and pipelines over the next decade.

The Treasurer said the National Water Infrastructure Loan Facility would “catalyse new investment”, and builds on the government’s existing National Water Infrastructure Development Fund and the Northern Australia Infrastructure Facility.

The announcement comes days after the National Audit Office issued a scathing report into concessional farm loans programs run by both the current government and its Labor predecessor, which it said were poorly designed, badly managed and not evaluated for success or failure.

The criteria for the loans have not yet been determined.

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Science, R&D and environmental programs

The already-announced plan for a $15 million carp culling program was confirmed, and was the budget’s major science announcement.

In line with agreements already forged between government and relevant industries, a compulsory export fodder levy will be introduced, and citrus levies increased, to help fund research and development.

Additionally, excise levies and customs charges on deer velvet and live deer will cease, while an emergency pest response levy for plantation forest producers will be increased, to pay for the response to giant pine scale.

This state election the Queensland Farmers’ Federation (QFF) continues to call for reform to the way governments assist and support farmers before and after natural disasters. More than any other se...